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Hong Kong Branch Talk - Shipping Markets Changing Dynamics
Posted on Thursday, November 23, 2017
The Institute of Chartered Shipbrokers, Hong Kong Branch, along
with a number of co-organisers, presented a very well attended talk
on Thursday 23rd November 2017 during the Hong Kong
Maritime Week at the Hong Kong Convention & Exhibition
The event was co-organised with The Hong Kong Polytechnic
University, CY Tung International Centre for Maritime Studies,
Institute of Seatransport, Hong Kong Logistics Management Staff
Association, Marine Insurance Club, Young Professionals in Shipping
Network and Hong Kong Institute of Arbitrators.
The topic of the talk was "Shipping Markets: Changing Dynamics"
and was delivered by Mr Jagmeet Makkar FICS, MSc (Cass), PCBA,
FRINA, FIMarE(I), FHKIArb, MCIArb, Past Chairman of the Institute -
Hong Kong Branch, Member of the Institute ETC and SKILLSPlus Pte.
Ltd. Director & Co-Founder.
Jagmeet laid emphasis that we often ignore the subtle yet
"future-significant" changes that have the potential to affect the
way we do business. These could be the impact of forthcoming or
even "future-possible" financial and environmental regulations. He
also went on to discuss US's increasing inward looking policies,
possibility of a soft Brexit (if at all) and the opportunities for
China to make its Belt & Road Initiative (BRI) not only a
reality but a grant success.
The impact of BRI for wet and gas sector is expected to be
negative due to long distance oil and gas pipes lines running for
thousands of miles. Short to medium term impact positive for dry
bulk trade and possibly very encouraging for container industry
when the countries which are part of BRI have effective
infrastructure and the masses expect a better quality of life.
However, this is a bit far in future and it will have to be seen
how the impact of competing rail and road transportation of
containers plays out.
The multiplier by which global trade increases for every 1%
increase in the global GDP has gone below unity due to increasing
share of service oriented economy, protectionism etc. This does not
bode well for the world trade, majority of which is by sea. Indian
economy is expected to provide some support. However the reducing
thermal coal import is a matter of concern.
Finally he touched upon briefly on the technological changes and
impressed upon "Think-Economic", "Think-Risk" concept. He concluded
that the negatives were slowing demand, protectionism / US trade
policies as we see them now, GDP versus Global Trade Growth with
less than unity multiple, reduction in the growth percentage of
Chinese Economy and Geo-political situation with regions of
uncertainty and instability, especially Middle East.
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